Third-quarter 2022 marked the 20th consecutive quarter of increased premiums for commercial property/casualty, according to the latest report from the Council of Insurance Agents and Brokers (CIAB).
The average premium increase across all account sizes was was 8.1% in Q3 2022, up from 7.1% in the second quarter.
Premium pricing continued to moderate for most lines of business. Across all lines, the average premium increase was 7% in Q3.
Cyber insurance saw premiums increase 20.3% in Q3 2022 compared to 26.8% in the previous quarter and a record high of 34.3% in Q4 2021. CIAB said demand for cyber coverage remained high, with 78% of respondents reporting that they saw an increase. One survey respondent said there was some stabilization in cyber rates “as long as all controls were in place.” Others indicated some challenges as carriers added sublimits to certain coverages like ransomware and extortion, and retentions are increasing.
Commercial property saw premiums rise an average 11.2% in Q3 compared to 8.3% in Q2, driven by inflation and natural catastrophes. The vast majority (95%) of brokers agreed inflation was influencing market trends in the third quarter, especially in commercial property. Inflation increased construction costs, which led to increased property valuations, said CIAB.
More than half of respondents reported an increase in commercial property claims in Q3, possibly driven by catastrophes. Flood were up in Q3, with 31% of respondents reporting an increase. One respondent said catastrophe-property “saw significant rate increases and restriction of capacity,” which another reported big increases in deductibles.
Commercial auto premiums were up 7.6% in the third quarter compared to 7.2% in Q2. This marked the 45th straight quarter of rate increases, thanks in large part to a rise in repair and replacement costs. Fifty percent of broker respondents also said claims were up in Q3.
Workers compensation was the only line to see a decrease in Q3 2022, with premiums coming in at -0.7% compared to -1.2% in the second quarter.
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